SAO PAULO, Dec 1 (Reuters) - Spanish renewable energy and engineering group Abengoa will fire almost all of its 5,000 workers in Brazil, a union said on Monday, as the indebted company faces severe liquidity problems after initiating insolvency proceedings.
Abengoa, which employs 24,000 worldwide, fired 500 workers in the Brazilian state of Bahia last week and has started proceedings to lay off a further 1,500 in the same state.
“Only 400 will remain (in Brazil) ... to maintain the projects so that the equipment does not lose value,” said Irailson Warneaux, vice president of Sintepav-BA, a Bahia union, who attended a meeting with Abengoa representatives last week.
The company last week filed for protection against creditors, which are owed around 20.2 billion euros ($21.4 billion) including project financing, after a potential investor pulled out leaving it facing a full-blown insolvency process and possible bankruptcy.
The Brazilian power regulator Aneel said it is aware of Abengoa’s problems and will meet with company representatives this week for more information on the potential impact on its projects.
“We are in a process of restructuring to preserve the company with the aim of negotiating with our creditors,” a spokeswoman for Abengoa said in an email. ($1 = 0.9442 euros) (Reporting by Luciano Costa; Writing by Angus Berwick; Editing by Paul Day, Greg Mahlich)